Billy Childress v. Natasha Currie

IN THE COURT OF APPEALS OF TENNESSEE

AT JACKSON

BILLY JOE CHILDRESS v. NATASHA BARNES CURRIE, both

individually and as administrator C.T.A. of the ESTATE OF VIRGINIA

MARY LEONARD,

Direct Appeal from the Circuit Court for Lauderdale County

No. 5029 Joseph H. Walker, Judge

No. W1999-00471-COA-R3-CV - Decided May 15, 2000

In this dispute, Plaintiff Billy Joe Childress contests a will executed by Virginia Mary Leonard (“the

Decedent”) on May 22, 1997, the sole beneficiary of which is Defendant Natasha Barnes Currie. A

jury found that the Decedent had testamentary capacity to execute the May 22, 1997 will and that

there was clear and convincing evidence to overcome the presumption that Ms. Currie exercised

undue influence over the Decedent. Upon a post-trial motion filed by Mr. Childress, however, the

trial court set aside the jury verdict. For the reasons set forth below, we reverse the ruling of the trial

court and reinstate the jury verdict in favor of Ms. Currie.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Reversed; and

Remanded

FARMER , J., delivered the opinion of the court, in which CRAWFORD , P.J., W.S., and LILLARD , J.,

joined.

Charles W. Fowler and Adam F. Glankler, Memphis, Tennessee, for the appellant, Natasha Barnes

Currie.

J. Thomas Caldwell, Ripley, Tennessee, for the appellee, Billy Joe Childress.

OPINION

Ms. Currie is the granddaughter of Elizabeth Barnes, who was the Decedent’s second cousin.

Mr. Childress was a friend and former employer of the Decedent. On February 16, 1994, the

Decedent executed a will leaving her entire estate to Mr. Childress. In April of 1997, Ms. Currie

began living with the Decedent on a part time basis and helping the Decedent care for herself and

her home. By May of 1997, Ms. Currie was living with and assisting the Decedent on a full time

basis. On May 5, 1997, Ms. Currie drove the Decedent and Ms. Barnes to the Bank of Ripley, where

the Decedent cashed in $4,374.91 of an $8,446.22 certificate of deposit and arranged for Ms. Barnes’

name to be placed on the certificate of deposit. On May 22, 1997, at the Decedent’s request, Ms.

Currie drove the Decedent and Ms. Barnes to Currie’s Funeral Home, where the Decedent purchased

a prearranged funeral plan from Frank Currie1 for the sum of $5,421.00. After purchasing the funeral

plan, the Decedent asked Mr. Currie to draft a power of attorney in favor of Ms. Currie and a will

leaving her entire estate to Ms. Currie. Mr. Currie then drafted and the Decedent executed a power

of attorney in favor of Ms. Currie, as well as a will stating as follows:

I, Virginia M. Leonard, of Lauderdale County, State of Tennessee, City of Ripley, the

undersigned hereby declare and appoint Natasha Barnes Currie the right to handle

any and all of my business and to live with me. At the time of my death Natasha

Barnes Currie will have all of my possessions.

On June 10, 1997, the Decedent was admitted to the hospital, where she was treated by Dr. Luis

Wong. She was subsequently transferred to the geriatric/psychiatric unit of the hospital and treated

by Dr. Louis Wells. On July 3, 1997, the Decedent was discharged to a nursing home, where she

died sixteen days later.

On July 31, 1997, the Lauderdale County Probate Court admitted the Decedent’s February

1994 will to probate and appointed Mr. Childress to serve as the executor of the Decedent’s estate.

In September of 1997, Ms. Currie filed a petition contesting the Decedent’s February 1994 will and

offering the Decedent’s May 1997 will for probate. In his response to the petition, Mr. Childress

alleged that the Decedent did not have testamentary capacity to execute the May 1997 will and that

the Decedent signed the May 1997 will as a result of undue influence. The probate court

subsequently entered an order temporarily suspending the letters testamentary previously issued to

Mr. Childress. In October of 1997, Mr. Childress filed a complaint contesting the validity of the

Decedent’s May 1997 will. Thereafter in November of 1997, the probate court admitted the

Decedent’s May 1997 will to probate and appointed Ms. Currie as the administrator, C.T.A. of the

Decedent’s estate. Additionally, at the request of both parties, the matter was transferred to the

Lauderdale County Circuit Court for a jury trial pursuant to section 32-4-101 of the Tennessee Code

Annotated.2 The parties presented their proof on February 22, 23, and 24, 1999, after which Mr.

1

Although Frank Currie is not directly related to Natasha Barnes Currie, he is the uncle of

Ms. Currie’s former husband.

2

This provision states as follows:

Where the validity of any last will or testament, written or nuncupative, is contested,

the court having probate jurisdiction over such last will or testament shall cause the

fact to be certified to the circuit court, and send to the court the original will, and

shall require the contestant to enter into bond, with surety, in the penal sum of five

hundred dollars ($500), payable to the executor mentioned in the will, conditioned

for the faithful prosecution of the suit, and, in case of failure therein, to pay all costs

that may accrue thereon.

Tenn. Code Ann. § 32-4-101 (1984).

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Childress made a motion for a directed verdict, arguing (1) that the burden is on Ms. Currie to prove

by clear and convincing evidence the fairness of the transaction, (2) that the only way to show the

fairness of the transaction is by proving that the Decedent received independent advice prior to

executing her May 1997 will, and (3) that Ms. Currie had not presented any evidence suggesting that

the Decedent received independent advice prior to executing the May 1997 will. The court took the

motion under advisement. The court then instructed and submitted two questions to the jury, as

follows:

1. On May 22, 1997, at the time of the execution of the document, did

Virginia Leonard have the mental competency to make a will?

2. Did the proponent of the will show by clear and convincing evidence the

fairness of the transaction and nonexistence of undue influence at the time of the

execution of the document?

The jury answered both of these questions in the affirmative. An order reciting the jury’s verdict was

entered by the circuit court on March 1, 1999. Mr. Childress subsequently filed a motion for a new

trial and a motion for a judgment in accordance with his motion for a directed verdict, which the

court had previously taken under advisement. On April 12, 1999, the circuit court issued an order

granting Mr. Childress’ motion for a directed verdict and setting aside the jury’s finding regarding

the issue of undue influence. In this order, the court specifically found that the Decedent did not

receive independent advice prior to executing her May 1997 will and that, under the circumstances

of the case at bar, proof of independent advice was the only way to rebut the presumption of undue

influence and show the fairness of the transaction. Ms. Currie subsequently filed a motion to alter

or amend the circuit court’s April 12, 1999 ruling, which was denied by the court. This appeal by

Ms. Currie followed.

The issues presented on appeal, as we perceive them, are as follows:

1. Did the trial court err in instructing the jury that, as a matter of law, there is

a presumption that the Decedent was under the undue influence of Ms. Currie

at the time that she executed the May 1997 will?

2. Did the trial court err in granting Mr. Childress’ motion for a directed verdict

and setting aside the jury’s finding that Ms. Currie had proven by clear and

convincing evidence the fairness of the transaction and that the Decedent was

not under undue influence at the time that she executed the May 1997 will?

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Ms. Currie appeals from the decision of the circuit court to grant Mr. Childress’ motion for a directed

verdict. In ruling on the motion for a directed verdict, the circuit court reached certain legal

conclusions that are subject to de novo review and are not accompanied by a presumption of

correctness. See, e.g., Bell ex rel. Snyder v. Icard, Merrill, Cullis, Timm, Furen and Ginsburg,

P.A., 986 S.W.2d 550, 554 (Tenn. 1999); T.R.A.P. 13(d). To the extent, however, that the court’s

ruling on the motion for a directed verdict was based on its findings of fact, we must review the

court’s decision taking the strongest legitimate view of the evidence in favor of the non-moving party

which, in the case at bar, is Ms. Currie. See Ezell v. Associates Capital Corp., 518 S.W.2d 232, 233

(Tenn. 1974); United Brake Sys., Inc. v. American Envtl. Protection, Inc., 963 S.W.2d 749, 754

(Tenn. Ct. App. 1997); Harrogate Corp. v. Systems Sales Corp., 915 S.W.2d 812, 817 (Tenn. Ct.

App. 1995); Souter v. Cracker Barrel Old Country Store, Inc., 895 S.W.2d 681, 683 (Tenn. Ct.

App. 1994). We must remove any conflict in the evidence by construing the evidence in the light

most favorable to Ms. Currie and discarding all countervailing evidence. See Ezell, 518 S.W.2d at

233; United Brake Sys., Inc., 963 S.W.2d at 754; Harrogate Corp., 915 S.W.2d at 817; Souter, 895

S.W.2d at 683; Underwood v. HCA Health Servs. of Tennessee, Inc., 892 S.W.2d 423, 425 (Tenn.

Ct. App. 1994). If, after evaluating the evidence in this manner, it is determined that reasonable

minds could not disagree regarding the conclusions to be drawn from the evidence, then we must

affirm the circuit court’s decision to grant Mr. Childress’ motion for a directed verdict. See United

Brake Sys., Inc., 963 S.W.2d at 754; Underwood, 892 S.W.2d at 426. If, however, there is any

doubt regarding the proper conclusions to be drawn from the evidence, we must reverse the court’s

ruling with respect to the motion. See United Brake Sys., Inc., 963 S.W.2d at 754; Souter, 895

S.W.2d at 683.

We first address whether the circuit court erred in granting Mr. Childress’ motion for a

directed verdict and setting aside the jury’s finding that Ms. Currie had proven by clear and

convincing evidence the fairness of the transaction and the nonexistence of undue influence. In its

April 12, 1999 order, the court found (1) that, under the circumstances of the case at bar, the only

way in which Ms. Currie could have overcome the presumption of undue influence was by proving

that the Decedent had received independent advice prior to the execution of her May 1997 will and

(2) that, as a matter of law, the Decedent did not receive independent advice prior to executing the

May 1997 will. On appeal, Ms. Currie argues that the circuit court improperly placed on her the

burden of proving the fairness of the transaction. Assuming, however, that the circuit court was

correct with respect to the burden of proof in the case at bar, Ms. Currie contends that the court erred

in its conclusion that the only way to prove the fairness of the transaction was by showing that the

Decedent received independent advice. Finally, assuming that proof of independent advice was

necessary in order to show the fairness of the transaction, Ms. Currie argues that the Decedent

received independent advice from Mr. Currie, who prepared the Decedent’s May 1997 will and

power of attorney.

It is well settled that the execution of an unrestricted power of attorney creates a confidential

relationship between the person granting the power (the principal) and the person receiving the

power (the attorney-in-fact). See Matlock v. Simpson, 902 S.W.2d 384, 386 (Tenn. 1995); Johnson

v. Craycraft, 914 S.W.2d 506, 510 (Tenn. Ct. App. 1995); Mitchell v. Smith, 779 S.W.2d 384, 389

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(Tenn. Ct. App. 1989); Arnoult v. Griffin, 490 S.W.2d 701, 706 (Tenn. Ct. App. 1972); State ex

rel. Teague v. Home Indem. Co., 442 S.W.2d 276, 279 (Tenn. Ct. App. 1967); Black v. Pettigrew,

270 S.W.2d 196, 202 (Tenn. Ct. App. 1953); First Tennessee Bank Nat’l Ass’n v. Webb, No.

03A01-9801-CH-00011, 1998 WL 906709, at *4 (Tenn. Ct. App. Dec. 22, 1998); Kelley v. Martin,

No. 01A01-9803-PB-00157, 1998 WL 832413, at *3 (Tenn. Ct. App. Dec. 3, 1998); Perry v. Rubley,

No. 01-A-01-9801-CH00044, 1998 WL 652587, at *5 (Tenn. Ct. App. Sept. 23, 1998); Barham v.

Cooper, No. 02A01-9608-Ch-00200, 1997 WL 542922, at *3-4 (Tenn. Ct. App. Sept. 5, 1997);

Garton v. Norman, No. 01-A-01-9511-CH-00514, 1996 WL 325215, at *5 (Tenn. Ct. App. June 14,

1996); Puckett v. Krida, No. 01-A-01-9403-CV-00100, 1994 WL 475863, at *6 (Tenn. Ct. App.

Sept. 2, 1994); Lindseth v. Norwood, No. 33, 1990 WL 143221, at *2 (Tenn. Ct. App. Oct. 3,

1990). When there is a confidential relationship between two parties and the parties engage in a

transaction involving the assets of the weaker party that benefits the dominant party, there is a

presumption that the transaction is invalid. See Matlock, 902 S.W.2d at 386; Elam v. Oakley, 738

S.W.2d 169, 193 (Tenn. 1987); Richmond v. Christian, 555 S.W.2d 105, 107 (Tenn. 1977); Estate

of Depriest v. Allen, 733 S.W.2d 74, 78 (Tenn. Ct. App. 1986); Peoples Bank v. Baxter, 298

S.W.2d 732, 737 (Tenn. Ct. App. 1956); Roberts v. Chase, 166 S.W.2d 641, 650-51 (Tenn. Ct. App.

1942). This presumption of invalidity is rebuttable upon a showing of the fairness of the transaction

by clear and convincing evidence. See Matlock, 902 S.W.2d at 386 (overruling cases requiring only

a preponderance of the evidence to overcome the presumption of invalidity); Hogan v. Cooper, 619

S.W.2d 516, 519 (Tenn. 1981); Richmond, 555 S.W.2d at 107; Johnson, 914 S.W.2d at 511;

Estate of Depriest, 733 S.W.2d at 78-79; Brown v. Weik, 725 S.W.2d 938, 945 (Tenn. Ct. App.

1983); Simmons v. Foster, 622 S.W.2d 838, 840-41 (Tenn. Ct. App. 1981); Roberts, 166 S.W.2d

at 651. The burden of proving the fairness of the transaction rests upon the dominant party to the

relationship. See Gordon v. Thornton, 584 S.W.2d 655, 658 (Tenn. Ct. App. 1979); Arnoult, 490

S.W.2d at 708. One means of overcoming the presumption of invalidity is by proof that the weaker

party received independent advice before engaging in the transaction that benefitted the dominant

party. See Hogan, 619 S.W.2d at 519; Richmond, 555 S.W.2d at 107-8; Estate of Depriest, 733

S.W.2d at 79; Peoples Bank, 298 S.W.2d at 737. Proof of independent advice is not, however, an

essential requirement. See Hogan, 619 S.W.2d at 520; Richmond, 555 S.W.2d at 108; Estate of

Depriest, 733 S.W.2d at 79; Gordon, 584 S.W.2d at 658. The court may also look to the totality

of the circumstances to determine whether the presumption has been overcome. See, e.g., Gordon,

584 S.W.2d at 658.

In the instant case, the Decedent executed a power of attorney in favor of Ms. Currie. She

then executed a will benefitting Ms. Currie, which granted to Ms. Currie “the right to handle any and

all of [the Decedent’s] business and to live with [the Decedent].” Thus, the circuit court assumed

in its order setting aside the jury verdict that there was a confidential relationship between the

Decedent and Ms. Currie giving rise to the presumption that the Decedent’s May 1997 will is invalid.

It is undisputed, however, that Mr. Currie prepared the May 1997 will and power of attorney at the

request of the Decedent. It is further undisputed that Ms. Currie did not participate in the execution

of these documents and was not even present at the time that the documents were executed. Finally,

it is undisputed that Ms. Currie was not aware that a power of attorney had been executed in her

favor until the evening of May 22, 1997, after the execution of the Decedent’s May 1997 will.

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As noted above, the courts of this state have repeatedly held that the execution of an

unrestricted power of attorney creates a confidential relationship between the principal and the

attorney-in-fact. In each of these cases, the attorney-in-fact took some affirmative action to

encourage or assist in the execution of the power of attorney, exercised the power of attorney, or, at

the very least, was aware of the existence of the power of attorney. See Matlock, 902 S.W.2d at 385

(Simpson prepared and assisted in the execution of a power of attorney naming himself as Matlock’s

attorney-in-fact as well as a will naming himself as the beneficiary of the majority of the Matlock’s

estate.); Johnson, 914 S.W.2d at 507-09 (Johnson granted a power of attorney to Craycraft, who

subsequently exercised the power of attorney (1) by writing a $200,000.00 check against Johnson’s

bank account to purchase a certificate of deposit that was placed in both his and Johnson’s names

and that was later used to purchase a certificate of deposit in Mr. Craycraft’s name only and (2) by

writing a $15,000.00 check against Johnson’s bank account and depositing the check in an account

owned by Craycraft and his wife.); Mitchell, 779 S.W.2d at 387 (Smith drove Bush to the office

of an attorney who had been recommended by Smith’s husband, where Bush subsequently executed

a power of attorney in favor of Smith and a will naming Smith as a beneficiary of his estate.); State

ex rel. Teague, 442 S.W.2d at 277-78 (Gooch executed a power of attorney in favor of his nephew,

who subsequently persuaded Gooch to give him substantial amounts of cash to be distributed as gifts

to himself and other members of Gooch’s family.); Black, 270 S.W.2d at 202 (Black executed a

power of attorney in favor of Homer, who subsequently exercised the power of attorney by handling

Black’s real estate and other business matters.); Webb, 1998 WL 906709, at *1-2, 5 (Webb executed

a warranty deed transferring his interest in a piece of real property to his son and immediately

thereafter executed a power of attorney in favor of his son.); Kelley, 1998 WL 1998 WL 832413,

at *1 (Davis executed a power of attorney in favor of Kelley, who subsequently exercised the power

of attorney (1) by using Davis’ funds to purchase a home, which Kelley ultimately received in fee

simple, and (2) by selling Davis’ home and placing the proceeds of the sale in a bank account and

a certificate of deposit bearing both Davis’ and Kelley’s names.); Barham, 1997 WL 542922, at *1-2

(Barham executed a power of attorney in favor of Cooper, after which Cooper began controlling

Barham’s finances and collecting income from the rental of Barham’s home.); Garton, 1996 WL

325215, at *1-2 (Randolph executed a power of attorney in favor of Norman and, after Randolph was

declared incompetent, Norman began handling Randolph’s business affairs.); Puckett, 1994 WL

475863, at *1 (Hooper executed a power of attorney in favor of Krida, Krida began exercising the

power of attorney, and Hooper subsequently executed a will leaving her entire estate to Krida and

Puckett.); Lindseth, 1990 WL 143221, at *1 (Tedder executed a power of attorney in favor of

Norwood and Norwood subsequently executed the power of attorney by removing approximately

$40,000.00 from Tedder’s bank account and placing it in a new account bearing the names of

Norwood and Tedder’s grandson and another new account bearing the names of Norwood and

Tedder.). In the instant case, it is undisputed that Ms. Currie did not know that the Decedent had

executed a power of attorney in her favor until after the execution of the Decedent’s May 1997 will.

In each of the cases cited above, however, there is no evidence suggesting that the attorney-in-fact

was unaware of the existence of the power of attorney. Thus, these cases do not specifically address

whether a confidential relationship exists between a principal and his or her attorney-in-fact when

the attorney-in-fact has no knowledge, prior to the transaction from which the attorney-in-fact

receives a benefit, that the principal has executed the power of attorney in his or her favor.

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Although the execution of an unrestricted power of attorney creates a confidential

relationship between the principal and his or her attorney-in-fact, this Court has previously held that

such a relationship does not arise when, although executed, the power of attorney had not yet become

effective at the time of the transaction benefitting the attorney-in-fact. In Garton, Marie Randolph

executed a power of attorney in favor of her nephew Henry Norman, which specifically provided that

it was to become effective upon Mrs. Randolph’s disability or incapacity. See Garton, 1996 WL

325215, at *1-2. After Mrs. Randolph was subsequently declared by her doctor to be mentally

incapacitated, Mr. Norman began exercising the power of attorney. See id. at *4. Three of the

beneficiaries of Mrs. Randolph’s will subsequently filed an action against Mr. Norman claiming that

he had misused Mrs. Randolph’s funds and exercised undue influence over her. See id. at *1. The

three beneficiaries challenged all transactions between Mrs. Randolph and Mr. Norman that took

place after the execution of the power of attorney in favor of Mr. Norman, arguing that the execution

of the power of attorney created a confidential relationship between Mrs. Randolph and Mr. Norman.

See id. at *3-4. It was Mr. Norman’s contention, however, that a confidential relationship did not

arise until after Mrs. Randolph was declared to be mentally incapacitated and the power of attorney

became effective. See id. at *4. This Court agreed with Mr. Norman, stating that “a power of

attorney that has not yet taken effect, and which may be altered or revoked at any time by the person

granting it cannot be considered to be unrestricted.” Id. at *5. More recently, in McKinley v. Holt,

No. 03A01-9807-PB-00220, 1999 WL 233400 (Tenn. Ct. App. Apr. 15, 1999), we reaffirmed our

holding in Garton, stating as follows:

The power of attorney executed by Mr. McKinley contained the following restriction:

"this power of attorney shall become effective upon my disability or incapacity,

which shall be determined by the certification of my personal physician, but not until

then. . . ." Although appellant argues that an unrestricted power of attorney was

created, we agree with the trial court that the power of attorney never came into effect

because Mr. McKinley was never certified by his physician as disabled or

incapcitated[sic], and therefore, a confidential relationship as a matter of law did not

exist.

Id. at *4.

In the case at bar, the power of attorney executed by the Decedent did not contain any

restrictions similar to those contained in the powers of attorney executed in Garton and McKinley.

Thus, the power of attorney technically became effective upon its execution by the Decedent. It is

undisputed, however, that Ms. Currie had no knowledge of the power of attorney at the time that the

Decedent executed her May 1997 will. Without knowledge of the power of attorney, it was

impossible for Ms. Currie to exercise the rights granted to her in the power of attorney. Ms. Currie

did not obtain this knowledge until the evening of May 22, 1997, after the execution of the

Decedent’s May 1997 will. As a practical matter, then, the power of attorney could not have been

exercised by Ms. Currie when the Decedent executed her May 1997 will.

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Under the circumstances of the case at bar, where Ms. Currie did not become aware that the

Decedent had executed a power of attorney in her favor until after the Decedent executed her May

1997 will, we cannot say, as a matter of law, that there was a confidential relationship between Ms.

Currie and the Decedent giving rise to the presumption that the Decedent’s May 1997 will was

procured by the undue influence of Ms. Currie. Rather, we hold that the circumstances of this case

represent a narrow exception to the general rule that the execution of an unrestricted power of

attorney creates a confidential relationship between the principal and his or her attorney-in-fact.3 The

language used in the circuit court’s April 12, 1999 order granting Mr. Childress’ motion for a

directed verdict and setting aside the jury verdict demonstrates that the court assumed that there was

a confidential relationship between Ms. Currie and the Decedent and consequently shifted the burden

to Ms. Currie to prove the fairness of the transaction by clear and convincing evidence. Because,

as indicated above, there was not such a relationship in the case at bar, we reverse the circuit court’s

order granting Mr. Childress’ motion for a directed verdict and setting aside the jury verdict.

We next address whether the circuit court also erred when instructing the jury regarding the

issue of undue influence. The court charged the jury in pertinent part as follows:

The alleged will comes to you with a presumption that it is brought about by

undue influence; that is, as a matter of law an unrestricted power of attorney in and

of itself creates a confidential relationship between the parties. The existence of a

confidential relationship followed by a transaction where the dominant party receives

a benefit from the other party gives rise to a presumption of undue influence. This

presumption can be rebutted by clear and convincing evidence of the fairness of the

transaction.

Currie, the proponent of the alleged will, has the burden of showing by clear

and convincing evidence the fairness of the transaction and the nonexistence of

undue influence.

In the previous section of this opinion, we held that, because Ms. Currie was unaware at the time that

she was the Decedent’s attorney-in-fact, there was not, as a matter of law, a confidential relationship

between Ms. Currie and the Decedent when the Decedent executed her May 1997 will. Thus, we

now conclude that the trial court erred when instructing the jury regarding the burden of proof in the

case at bar. Despite this error, however, the jury returned a verdict in favor of Ms. Currie,

specifically finding that Ms. Currie had proven the fairness of the transaction and the nonexistence

of undue influence at the time that the Decedent executed the May 1997 will. Thus, we conclude

that any error with respect to the instructions given to the jury was harmless.

3

In light of this holding, we find it unnecessary to address whether the court also erred in its

conclusion that the only way to show the fairness of the transaction was with proof of independent

advice and whether the Decedent did, in fact, receive independent advice from Mr. Currie.

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Because it was predicated on an erroneous conclusion of law, we reverse the circuit court’s

April 12, 1999 order and reinstate the jury verdict in favor of Ms. Currie. Costs on appeal are

assessed against Billy Joe Childress, for which execution may issue if necessary.

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